Oil prices rise, pushing up stocks, Canadian dollar
Oil continued its rally on Monday, pushing stocks and the Canadian dollar higher.
West Texas Intermediate crude was up 58 cents at $56.32 US a barrel at the close, after trading as low as $54.97 earlier in the day.
Brent crude, the most common international contract, was up 10 per cent since the beginning of the year at $63.45 US a barrel. Western Canada Select, a Canadian contract, was at $40.03 after rising all last week.
The bounce in oil prices has pushed the loonie higher and it is trading today at $81.72 US.
Similarly, Toronto stocks were buoyed by a recovery in energy stocks, as well as mining stock, although metal prices were not higher.
Traders seemed to be counting on a boost to the Chinese economy after China's central bank eased restrictions on bank reserve requirements. That could help stimulate demand for metals, a key export from Canada to China.
There seemed little to account for the continued rise in oil prices but last week's news about the slowdown in oil production.
Money flowing to oil
However, a report from Bloomberg said that money has continued to pour into oil stocks and oil plays despite the drop in prices that took WTI from over $100 US to less than $50 last month.
Investors have few alternatives as stock prices are back near their peaks. Many hedge funds and private equity investors are snapping up energy stocks because they've been beaten down by the market. Oil firms attempting to recapitalize to get through the downturn are having less trouble than expected finding investors.
The TSX was up 52 points at 15412.
The Dow rose 208 points or 1.2 per cent to 18034 and the S&P 500 was up 19 points at 2100.
There have been dire reports in the past two weeks about a dismal earnings season for U.S. companies, with profits set to decline in a dismal first quarter.
But some results that came in today defied those expectations. Financial institution Morgan Stanley saw its net income rise by 60 per cents to $2.3 billion US.
However, Halliburton, the oilfield services company, saw a net loss of $643 million, or 76 cents a share as drilling declined.
